Electronics sales help retail sector

Gamze Bal- ISTANBUL

According to official data, February saw the highest monthly increase in retail sales in a year, with computer sales marking their highest surge in the last 11 months, while textiles, clothing and footwear recorded a significant uptick in the last 18 months.

The Turkish Statistical Institute's (TÜİK) Retail Sales Volume Index for February 2024 showed that retail sales increased and the demand for electronic products had a doping effect on this increase.

According to the data, trade sales volume increased by 2.3 percent on a monthly basis in February, while retail sales volume increased by 3.5 percent in the same period. On a yearly basis, trade sales volume increased by 11.3 percent and retail sales volume increased by 25.1 percent. Looking at the details of the sectoral breakdown, the jump in sales of computers and electronic household appliances attracted attention.

Accordingly, computer sales, which declined by 6.1 percent in February 2023, when the Kahramanmaraş earthquakes occurred, increased by 7.5 percent in February 2024, recording the fastest performance in the last 11 months. Computer sales increased by 56.1 percent on an annual basis in February, making it the fastest-growing product group. Household electrical appliances, which rose 2.8 percent monthly in February, recorded the fastest growth in the last seven months with an annual increase of 25.2 percent.

According to the representatives of the sector, the increase in sales of electronic products was influenced by the citizens' expectation of an increase in the dollar exchange rate, the knowledge that credit card interest rates would increase due to the tight monetary policy of the Central Bank in the fight against inflation and rumors about the future limitation of installments on credit cards.

"Concerns that credit card installment will be limited have driven sales,” said Yaman Tunaoğlu of the Turkish Electronics Industry Association (TESİD).

“That is one factor. Another factor is that people are prioritizing their needs indexed to foreign currency with the concern that the exchange rate will increase in an inflationary environment," he added.

Central Bank Governor Fatih Karahan's messages of regulation on credit cards had raised expectations of restrictions. The bank raised the interest rate on cash withdrawals from credit cards and overdrafts in March, while the maximum interest rate on credit card transactions was raised to 4.25 percent earlier this month.

On the other hand, another remarkable increase in retail sales reflected in the TÜİK data was in textiles, clothing and footwear.

Sales of textiles, clothing and footwear, which declined by 0.1 percent in the first month of the year, increased by 2.4 percent in the second month of the year, recording the fastest monthly increase in the last 18 months. On an annual basis, these sales, which showed a very limited annual growth of 1.1 percent at the beginning of the year, increased by 16.1 percent by February.

Ramazan Kaya, the president of the Turkish Clothing Manufacturers' Association (TGSD), told daily Hürriyet that the discounts given in February were effective in increasing textile and ready-made clothing sales.

"We can say that the expectation of new increases after the local elections in March led to panic buying,” Kaya said.